There seems to be a growing trend for seniors to live together. Historically associated with younger people, the phenomenon of sharing a residence appears to be drawing a new generation.

For some seniors, it’s an opportunity to avoid isolation and loneliness. It also has the benefits of being able to share interests and activities, without necessarily sharing their love life.

What’s more important, like teens and young adults, seniors see the significant advantage of sharing housing costs. In the context of their generally more limited income and with the constantly increasing life expectancy, living with someone is an appealing solution to deal with this reduced income.

Tax impact

Living together is seen as another option for balancing one’s budget.

Despite the undeniable benefits of shared housing, are there tax impacts? A reader recently had questions about how her plans to move in with someone would affect her tax situation. Let’s look at some of the considerations more closely.

After they have lived together for 12 months, two individuals of the same or different sex are considered to be common-law spouses and would therefore be required to change their marital status when filing their tax returns.

Since some tax credits are calculated on a family income basis, the change of status could result in the two individuals losing certain tax benefits. However, just the fact of being roommates does not trigger a change in marital status.

To conclude that roommates are common-law spouses, they have to have lived in a conjugal relationship for 12 months.

Common-law spouses

Tax legislation does not define a conjugal relationship, therefore, the facts underlying the relationship will generally determine whether two individuals are common-law spouses.

The tax authorities usually consider two individuals to be in a conjugal relationship if they live in the same residence, present themselves as a couple, declare themselves to be spouses for insurance or pension purposes, enter into agreements or loans together, have intimate relations, etc.

There is no dominant factor per se, all of the facts at hand must be analyzed to determine if roommates are common-law spouses.

The main point to remember is that simply living together is not sufficient to consider that roommates are spouses.

Tips

1. Roommates should ensure that they properly report the nature of their relationship to the tax authorities.

2. Having a roommate means you can no longer claim the tax credit for a person living along.

3. Misrepresenting the situation could lead to a review of your tax situation and the need to repay certain benefits.


Consult your tax advisor for help in assessing your situation.

This article was published in French in Journal de Montréal and Journal de Québec on 2018, February 27.

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Welcome to IFRS Newsletter – a newsletter that offers a summary of certain developments in International Financial Reporting Standards (IFRS) along with insights into topical issues.

We begin this first edition of 2018 by considering the potential effect of the recent U.S. tax reforms on IFRS preparers with operations in the United States. We also remind readers of the key aspects of the two major new standards that have come into effect on January 1, 2018 (IFRS 9 Financial Instruments and IFRS 15 Revenue from Contracts with Customers) and take a look at issues that are currently attracting regulators’ attention.

We then move on to look at amendments the International Accounting Standards Board (IASB) has recently made to its standards. Further on in the newsletter, we present IFRS-related news at Grant Thornton and a general round-up of financial reporting developments.

We finish with a summary of the implementation dates of recently issued standards, and a list of IASB publications that are out for comment.

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Richard Chrétien
Partner, Vice-President | CPA, CA | Assurance

To ensure the permanence of Brise Bise, Raymond Chabot Grant Thornton and Richard Chrétien, Assurance Partner, supported the transferor and transferee throughout the business transfer process. This video highlights the human and financial considerations they faced.

06 Mar 2018  |  Written by :

Richard Chrétien is a partner at Raymond Chabot Grant Thornton. He is your expert in assurance for...

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Denis Brisebois
Senior Manager | Management consulting

Times change and so do citizens’ needs. It is essential for municipalities to reflect this as they plan infrastructures, equipment and the sport, leisure and culture services offered.

During the 60s, 70s and 80s, this was a relatively easy exercise, for many reasons:

  • Demographic forecasts were growing;
  • Clienteles were uniform;
  • Citizens needed few activities;
  • The services were provided almost exclusively by the municipality.

It’s clear that this same exercise now requires municipal leaders to have more skills and abilities than in the past.

In the past 20 years of our sports, leisure and culture practice, we’ve identified seven complex, challenging planning issues.

Clienteles are varied

They are in all age groups, come from various cultural backgrounds, have different ways of life and use services differently. This new information must be properly understood to identify innovative municipal strategies.

Competition is increasing

More and more businesses and organizations provide leisure equipment and services, sometimes placing the municipality in a competitive situation. This situation should be transformed into an opportunity to enter into partnerships. While some municipalities have already opted for this model, in the coming years, it will become more common and essential. To give just two examples, consider the need to coordinate with other government bodies regarding community and sports equipment in schools and the cultural equipment financed by the Ministère de la Culture.

Trends are evolving rapidly

Citizens’ leisure tastes and interests can change at the speed of light, which means that a municipality’s investment choices can quickly become obsolete. When making development and management choices, municipalities must ensure that their infrastructure and equipment will stand the test of time and not become costly and obsolete. They sometimes need to make difficult choices that consider citizens’ concerns and the social and political context.

Managing finances must be equitable

In the coming years, there will be increased pressure on ensuring financing equity between activities and organizations. In the past few decades, municipalities made choices to support activities and organizations (directly or indirectly, by financing infrastructures). With the sometimes explosive growth in the number of sports, leisure and cultural organizations and activities, municipal authorities need relevant, powerful analysis and decision-making tools. Unlike Issue on partnerships, where municipalities have made some inroads, there is still much work to do to ensure the fair and strategic management of municipal financing for sports, leisure and cultural organizations and activities, for example, events and festivals.

The environment is taking on greater importance

It is increasingly important to consider climate and technology issues. Some of the infrastructure and development planning challenges include outdoor skating rinks, air conditioning in schools (gyms and common areas, etc.), parks, green spaces and public spaces (shaded areas), etc. In terms of technology issues, there is a distinction to be made between improving management tools and service-related tools (for example, the library of the future). Technological progress will help managers improve client services and support the development of true scorecards and performance indicators (in line with Issue on financing).

Citizens are becoming increasingly involved

Over the years, citizens have become increasingly involved in the planning process. However, they no longer limit their involvement to surveys or meetings with organizations, they want to be part of the analysis and determination of strategic directions. They even want to take part in the equipment concept and design (co-creation). Municipal managers therefore need to master new planning skills and abilities.

The increase in tools requires extensive coordination

The extent of sports, leisure and cultural planning tools available to municipal mangers is expanding: policies (family, cultural, healthy life style, etc.), master plans (parks, green spaces, sports or cultural equipment, etc.), segment strategies (elite sports, technological or climate adaptations, public health, youth, etc.). While these tools are essential for a structured planning process, they should be fully integrated with each other and very often, we find that this is not the case.

The financial and political importance of properly managing municipal sports, leisure and cultural events requires municipal decision makers to find new ways of planning infrastructures and the service offering.

02 Mar 2018  |  Written by :

Denis Brisebois has provided strategic planning advice and guidance to businesses and public...

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